Diesel Price had declined across the country after over a month on Wednesday. However, the petrol prices have remained unchanged for 32 days. The price of diesel went down by 19 to 21 paise across major metros. Petrol rates across major metro cities still remain at a record high, with only diesel having shown any change so far. Fuel prices had seen an all-time high across the country when the rates were last hiked on July 17. Since then, the petrol and diesel rates across major cities have remained at a standstill. August 18 had petrol prices unchanged for 32 days, while diesel had remained unchanged for 33 days.
Petrol rates had last been hiked on July 17 by a range of 26 to 34 paise. Over the last 32 days, the price of petrol across major metropolitan cities had been unchanged. In the financial capital, Mumbai, the petrol prices on Wednesday continued to stagnate at Rs 107.83 per litre. In Delhi, the price of petrol remained at Rs 101.84 per litre. Kolkata and Bangalore were also unchanged with their fuel rates of Rs 102.08 per litre and Rs 105.25 per litre respectively. Chennai was the only major metro to see any change after the state government cut the excise duty. This left the petrol prices Rs 3.02 cheaper. The previous fuel rate in Chennai stood at Rs 102.49 per litre; the highest that the city had ever seen.
Diesel prices in Mumbai were down by 21 paise, with the price standing at a reduced Rs 97.24 per litre. In Delhi, the price was Rs 89.67 per litre of diesel, which is 20 paise cheaper than the old price. Kolkata had also seen a 20 paise drop as motorists shell our Rs 92.82 per litre of diesel. Bangalore followed the trend as citizens saw a 21 paise drop on August 18, which left the fuel price at Rs 95.05 per litre. Chennai was a standout amidst the metro cities once more in terms of diesel prices. The South-Indian metro saw its diesel prices drop by 19 paise, which left the final price at Rs 94.20 per litre. This makes Chennai the only major city to see both its petrol and diesel prices drop since July 17.
The majority of fuel prices can be attributed to the different taxes that the government levies against it. This can be divided into taxes levied by the Central government and the state government. It is also important to note that Value-Added Tax (VAT) and excise duty play a major role in the final retail price of petrol and diesel in the country. Other factors come from international waters in the form of the Dollar-to-Rupee exchange rate as well as crude oil prices in the market.
Crude oil prices continued to weaken due to weak demand in Asia. This comes as a result of a strong Dollar and the rising cases of Covid-19 in Japan, according to a Reuters report. Brent crude ended its session by dropping 48 cents, or 0.7 per cent which left the final price at $69.03 per barrel. On the other hand, US West Intermediate crude (WTI) went down by 70 cents, or 1 per cent, leaving the price per barrel at $66.59, the report mentioned. Additionally, the Dollar also advanced for a second straight session on Tuesday, which has made oil more expensive for holders of other currencies, said Reuters.
Union Finance Minister Nirmala Sitharaman on Monday said that the UPA government’s oil bonds have become a burden to the present Modi government which has made the reduction of the excise duty a difficulty. Sitharaman was not actively seeking to cut the excise duty of petrol or diesel attributing it to the payments in lieu of the past subsidised fuel.
“If I did not have the burden to service the oil bonds, I would have been in a position to reduce excise duty on fuel,? she said in a statement to the press.
Sitharaman then added, “Previous government have made our job difficult by issuing oil bonds. Even if I want to do something I am paying through my nose for the oil bonds.? This comes after Sitharaman had raised the excise duty on fuel to a record high to bolster revenue collections last year. She stated that the interest on oil bonds paid in the last seven years came up to Rs 70,195.72 crore.
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